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Expectations and Changing Customer Behaviour in Insurance Ecosystems

Consumer behavior theories are drawn from a variety of fields, including psychology, biology, chemistry, and economics. Consumer behavior research is significant because it assists marketers in understanding what elements impact customers' purchase decisions. Understanding how consumers select a product allows them to fill a market gap and determine which items are needed and which are outmoded.

The study of consumer purchasing behavior is critical for marketers because it allows them to understand what customers expect. It is useful to understand what drives a buyer to purchase a product. Before presenting new products to the market, it is critical to conduct market research on the categories of goods that individuals prefer. Marketers may use data to learn about consumer preferences and base their marketing efforts on them.

In recent years, changes in customer behavior have fueled the emergence of digital innovation in the insurance business. COVID-19 produced a disruption in the health industry, leading to a rise in claims interruption because of fewer business activities and reduced use of face-to-face channels. Insurance executives were forced to rethink their business strategy in hours, not weeks. If we've learned anything in recent years, it's that customer behavior is ever-changing. It was true during the beginning of the pandemic, and it is much truer now.

In 2022, consumer behavior reflects a shift in how individuals consume and purchase goods and services. Brands that understand the shifting landscape and adjust to match the habits and wants of customers will emerge victorious and win client loyalty.

It can be analyzed that consumer behavior has drastically changed since the COVID-19 pandemic. Reports showed that 46% of consumers shopped only online during the 2021 holiday season, the user-generated content (UGC) is 8.7 times more impactful than influencer content. Social commerce is on the rise with the next era of purchasers and 46% of Gen Z uses TikTok to get information about purchases or brands, while 69% use Instagram.

When it comes to ecosystem services, insurance clients throughout the world have distinct and surprisingly comparable tastes. According to the Bain poll, they want safety, ease, and rewards for good behavior.


With COVID-19 serving as a catalyst for change, insurers who fail to rethink their customer experience risk slipping behind industry leaders, who are already creating trusted connections with consumers and improving customer lifetime value.

There's no more time to waste. Incumbents have numerous and expanding chances to differentiate themselves through a more connected client experience. Of course, such a transition is difficult for any organization, but the stakes are high. As a result, the adage "client loyalty is not created instantly, but over time, supported by consistent digital and physical experiences across the customer's journey" remains true.

Customers in a Digital World

The digital transition provides a new opportunity for insurers to communicate with customers. To develop these touchpoints, insurers must first understand what motivates people's behavior and decisions. Insurers must also overcome the interpersonal boundaries generated by digital interfaces to connect emotionally with their consumers.

When the world is changing as quickly as it is now, the most difficult problem we all face is remaining relevant to our target market. And do you know what the main cause of the quick shifts is? It is the clients' ever-changing behavior. Consumers today have more options, which means they can quickly switch to a firm that provides superior products and services.

Omnichannel Approach

Finally, the modern shopper wants to be able to buy a product or service at any time, place, or channel while being confident in the security of their mobile payments.

The advancements in advertising brought about by Google ads, Facebook ads, Instagram ads, Snapchat ads, and the development of VR commercials allow users to examine all their options with their ease. The speed and simplicity of omnichannel shopping allow businesses to reach customers in the right digital place, at the right time, and with the right message to generate conversions.

On the other hand, there is a progression of the phenomena known as equivalent experience, in which a consumer expects all their interactions to be the same as their finest one across all touchpoints. Consumers are practically spoiled for choice, and with alternatives only a click or a touch away, there is no place for poor loading, unresponsiveness, and other flaws that can ultimately drive a client away from a company.

Megatrends: Digital Future

The digital future influences every company and underpins practically every other megatrend in some form. It is the disruption of technology as we know it, as demonstrated frequently by the installation of cloud, mobile technologies, social emphasis and tools, big data, and the insight that analytics provide when it comes to consumer trends.

Healthcare is undergoing an incredible shift. Because of mounting cost pressures and a growing middle class with increased healthcare demands, healthcare providers are seeking methods to innovate and become more cost-effective. The aim is to use big data analytics to harness patient data and trends so that doctors may focus on wellness care rather than illness treatment. This proactive tendency implies that healthcare providers may invest money in ensuring the public learns how to be healthy and maintain a healthy lifestyle, hence lowering chronic diseases and long-term care expenditures.

The future of urbanization and mobility

Over half of the world's population, today lives in cities, with that figure expected to rise to more than two-thirds by 2030. 12 This growth in urban inhabitants has raised the demand for innovative transportation options, such as e-hailing technologies, self-driving vehicles, and electrification. However, a fresh aversion to shared commuting as a result of the COVID-19 epidemic may further alter the mobility landscape,14 with significant implications for the future of work. In 1993, management expert Peter Drucker predicted that commuting to work would become "obsolete," and the epidemic may prove him correct.

Remote working has become the standard as a result of improved organizational cohesion brought about by technological advances, with nearly half of workers now preferring a model that will allow them to work from home more frequently in the future and three in four chief financial officers planning to shift at least 5% of on-site employees to permanently remote positions in the post-COVID-19 world. Within a few years, the rush-hour trip to the brick-and-mortar office building may be obsolete, forever altering the face of how we work.

The Importance of Convenience: How Convenient Is Your Claims Journey?

The insurance industry is famously cold. There are probably just four main consumer journeys: purchasing a policy, renewing it, filing a claim, and canceling it. Customers often hear from their insurer merely once or twice a year, and these conversations are frequently routine and administrative. Then it's radio quiet until the next renewal.

Few individuals enjoy filing insurance claims. When the time comes, clients want to be able to report their claims on the most convenient channel, 24 hours a day, seven days a week. They also wish to supply supporting paperwork as soon as possible. Transparency and consistent communication are essential. The journey should conclude with a quick and equitable resolution.

Making a claim is an accomplishment. It's the decisive time when the insurance policy either keeps or breaks its commitments. When emotions are at their highest, people rate an experience based on how they felt at the peak or end of it.

As previously stated, depending on the claimant's experience, loyalty is either reinforced or undermined. Customers' actions after filing a claim are significantly influenced. Some consumers will remain inactive, but the majority will become more engaged and louder. A positive experience leads to more satisfaction, more word-of-mouth referrals, and increased spending. Insurance businesses that do well in terms of claims satisfaction are rewarded with higher-than-average payouts.

The inconvenient truth

Unpaid claims, mountains of paperwork, perplexing processes, difficult phone conversations, and long wait times all make it easier to avoid being a client. According to Guidewire, nearly one-third of customers believe insurers oversell goods, are hesitant to pay out claims, or that it is a required but unpleasant service. There is a serious issue here. Customer loyalty is a fragile thing. However, insurers may attract business by providing customized coverage and all-inclusive packages. According to the Guidewire report, 55% of consumers would consider merging all of their insurance plans into a single, personalized package supplied by a single provider. Even clients who believe insurance is costly might consider the change.

The insurance sector is undergoing a profound, digitally-infused transformation. Both companies and customers are adopting digital channels, and technologies like the linked automobile, smart home solutions, and artificial intelligence (AI) have ushered in a new era of data-driven goods.

Attackers—insurers with pure-play digital business models, such as Lemonade in the United States, Youse in Latin America, or Nexible in Europe—use digital technologies like chatbots to make the process of purchasing a policy or making a claim quick, easy, and pleasant. This technique is a far cry from traditional insurers' analogous, and sometimes tedious, processes.

End-to-end digitization of the claims customer journey

The redesign of the claims customer journey lies at the heart of the claim function's digital transformation. There is no one-size-fits-all interaction that guarantees customer happiness, but a successful redesign often entails analyzing procedures from the customer's perspective and streamlining back-office operations to deliver easy and rapid claims services.

To release disruptive ideas, insurers should begin with an "everything is possible" mindset. Customer satisfaction studies in claims constantly demonstrate that customers want a quick and easy procedure, as well as openness about where they are in the process and what will happen next. As a result, the digital redesign of a claims experience must go far deeper than simple process improvements. Adeslas, a Spanish corporation, has strived to digitize its claims experience from beginning to finish, introducing features such as multichannel FNOL, automated claims segmentation, and digital claims status monitoring.

The typical claim management process lacks standardized claim-handling methods and necessitates a great deal of paperwork and manual interactions between staff and consumers. As a result, claim technicians and claim handlers are less efficient, and the process is not completed on time, resulting in greater claim processing expenses and a negative impact on client satisfaction. To thrive in a highly competitive market, insurers must adopt new trends and focus their long-term strategy on digitalization.

Although the digital customer journey is a hot topic among insurers these days, only a few can provide a fully digital, end-to-end client claim trip. To deliver easy, rapid, and transparent claim services, insurers should begin revamping their claim processes with a focus on customer happiness and process optimization. Furthermore, starting even before a claim event happens, every touchpoint in the claims journey should be supported by a combination of technology, AI and ML models, omnichannel experience, and claim technician involvement for more complicated claims.




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